Sky Road, a Chicago-based cloud technology provider, has officially launched a new application to help traders and brokers link to new swap execution facilities to execute new centrally cleared swaps.
The new Swap Trader represents a new application built on Sky Road’s cloud-based platform Motion that allows users to assemble custom-hosted financial applications via core building blocks that include market data, security master, analytics, as well as connectivity to execution venues prime brokers and fund administrators.
The Dodd-Frank Wall Street Reform Act will likely prompt the creation of new swap trading platforms to replace fax and phone when executing trades in so-called standardized over-the-counter derivatives. Trading desks will also be required to more carefully value swap contracts and calculate market, counterparty and liquidity risks when they clear them through clearinghouses.
“We’re facing a pivotal shift in the swaps market as the implementation of central clearing and more stringent regulatory oversight might create new pressure on trading and margins,” said John Borse, chief executive of Sky Road. “Our goal is to offer traders an intuitive application which reduces their need to integrate multiple systems such as execution management, order management and portfolio management.”
Instead of relying on multiple applications, proprietary traders, hedge fund trading desks and brokers can depend on a single platform for trading interest rate products. In addition to sending orders to swap execution facilities, traders can also calculate intraday profit and loss and calculate intraday spot risk using valuation models from FINCAD as well as real-time and end of day data from Bloomberg. That data includes access to real-time prices, and curve construction routines.
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